Can You Rely on Online Bank Statements?

Gone are the days when you had to retain every single record of your dealings with financial companies, utility companies, your employer, and countless other entities. In today’s world most of the data is stored online and you can be much more selective about which paperwork you have to retain and which you can throw away.

Most of the banks and brokerages have online presence now. These companies maintain huge databases of their customers’ records and usually this facility is good enough if you want to refer to an old transaction. However, there are a few things that you should be aware of if you’re relying on online records of your bank transactions.

First of all, you should know that your records wouldn’t be accessible forever on the bank’ site. Most banks keep these records for a few years but with some others you can access this information only for about 12 months. So check with your bank to find out how long you would be able to access your information. If you feel the need to refer back to really old transactions, then make sure to print out a copy of that particular statement before the transaction is taken off the database of the bank.

Quite often, you may need your statements on the letterhead of the bank. That is because some companies and government agencies do not accept printouts of online records. Most banks provide the facility of ordering a paper statement even when you have chosen to rely on online records primarily. However, these statements can often cost about $5, because the bank incurs printing and delivery charges. So before you throw your original statement out, make sure that you wouldn’t need it again.

Brokerages have policies similar to banks when it comes to retaining your records online. There could be some variation in the data retention policy of different brokerages. Again, you should check with the company how long your transactional records would be accessible on their website.

Another risk of relying on online records is that you never know when the bank or the brokerage may change its website policy and modify the time period for which it retains your statements. That is why it is better to retain any statements that contain large or important transactions that you may have to refer to in future, especially for tax purposes.